Lars Nyberg, a former CEO of Nordic telecom operator Telia, and two other defendants have gone on trial in Sweden over allegations that $350mn was paid to Gulnara Karimova in return for the “protection” of the Uzbek government and access to Uzbekistan’s telecoms market.
The trio of executives were charged in September last year after the Stockholm-based company agreed to pay $1bn in penalties to settle a long-running corruption probe into how bribes were paid to entities connected to Karimova, the disgraced daughter of Uzbekistan’s late ex-president Islam Karimov, to win licences to operate 3G and 4G services. Telia, as well as Russian companies VimpelCom (later renamed to VEON) and MTS, were accused of paying the bribes. VimpelCom was fined $795mn by the US and Dutch authorities for the bribes it paid in Uzbekistan.
The Stockholm court on September 4 ordered Telia's current CEO, Johan Dennelind, to testify under oath at the trial.
The closing arguments by lawyers are scheduled to be heard from December 11-14.
ING hit for €775mn
September 4 also saw Dutch bank ING agree to pay fines and other payments worth €775mn for “serious shortcomings” in executing policies that would prevent financial crime. One crime was a bribe paid by VimpelCom to an Uzbek company, Dutch prosecutors said in a statement.
While Dutch investigators found no evidence of ING helping its customers in potential criminal activities, prosecutors detailed several examples where ING accounts were used in committing crimes. They included the transfer of “bribes worth millions of dollars [by VimpelCom] via its bank accounts with ING to a company owned by the daughter of a former Uzbek president".
The Amsterdam-based bank said it regretted mistakes that allowed customers to use their accounts for money laundering and corrupt practices between 2010 and 2016. It was fined €675mn and agreed to pay another €100mn as a “disgorgement” payment.
Karimova was for years seen as her father’s heir until she was found to be the central figure in international corruption investigations. Court documents compiled by Swedish prosecutors asserted last year that Karimova used tactics of intimidation to wrest control of a major telecoms operator and turn it into a cash cow that she could draw on at her whim.
Four years ago, shortly after the bribery probe was launched, Karimova disappeared from the public eye and was placed under house arrest.
In September last year, the Uzbek Prosecutor-General's Office said it was seeking to freeze $1.5bn worth of Karimova’s assets in 12 countries. In total, the Uzbek authorities claim Karimova and her associates have stolen amounts of $1.6bn, €26mn, and UZS1.27tn ($311mn), which roughly adds up to $2bn.
In December, Karimova was added by the US to a list of 52 government-linked people from ex-Soviet countries subject to financial and travel restrictions that fall under Washington’s Magnitsky Act.
Little information about Karimova's status and health condition has been released by the Uzbek authorities since July 2017 when the prosecutor’s office revealed she had been sentenced in 2015 to five years of “restricted freedom” for embezzlement, extortion and tax evasion. She is said to be detained in a prison located outside Uzbek capital Tashkent.
Her, son, Islam Karimov Jr. has claimed that his mother only remains alive thanks to computer files she removed from Uzbekistan prior to her detention that hold compromising materials on senior members of the government. That allegation chimes with her lawyer Gregoire Mangeat’s insistence in June this year that her security was not guaranteed, despite her being in good health currently.